Meta stock price crawled back on Wednesday as Mark Zuckerberg took actions to save the company’s finances. The shares rose to $104.13, the highest point since October 26. It has risen by more than 18% from the lowest level this year. The shares have plunged by over 70% this year, crashing its market cap to about $269 billion. Mark’s net worth has plunged by more than $86 billion to $39 billion.
The fall of an empire
Meta Platforms is one of the biggest companies in the world. It owns some of the best-known brands in the world like Facebook, Instagram, and Whatsapp. In the past few months, the company has been going through a serious crisis.
The biggest challenge that Meta faces is Apple’s iOS 14 upgrade that made it possible for people to block their tracking settings. These upgrades makes it almost impossible for Facebook and other products to deliver targeted advertisements.
Meta’s other challenge is that competition in the advertising industry is rising. TikTok has taken a substantial market share in the industry. Most importantly, a company like Amazon has also become a leading player in the sector.
Meta share price has also crashed because of the lagging performance of the metaverse. The company is spending billions of dollars in an industry that is not growing. In fact, most people who buy its virtual glasses don’t use them often.
Most importantly, there is a feeling that Meta’s products like Facebook are old school. As such, the firm has struggled to come up with a new product that will attract young people. All these problems explains why Meta Platforms decided to lay off 11,000 people in a bid to save money as expenses jumped to over $22.1 billion per quarter.
Meta stock price forecast
The daily chart shows that the Meta share price has been in a strong bearish trend in the past few months. In this period, the shares have moved below all moving averages while the MACD has moved below the neutral level. The stock is yet to fill the gap that formed after its most recent earnings. It also remains below the important support level at $122.54.
It has also moved below the descending channel shown in green. Therefore, the Meta Platforms stock price will likely continue falling as sellers target the next key support level at $87.82. A move above the resistance at $114 will invalidate the bearish view.